MannKind officials, including billionaire inventor and CEO Al Mann, spent an hour on the phone with investors, trying to put a positive spin on Monday's decision by the U.S. Food and Drug Administration to delay approval of Afrezza, the company's inhaled insulin device for diabetes.
Yet, the more Mann and his underlings spoke, the more confusing and nonsensical the call became. Doubts and questions about the approvability and commercial viability of MannKind's Afrezza device seem more pronounced today than they were Monday.
MannKind's shares closed Monday at $7.89 but rose about 12% in Tuesday's pre-market trading session in advance of the conference call. By the call's conclusion around 10 am, the stock sunk into the red, down 4% to $7.57 in recent trading.In January, MannKind said FDA was forced to delay the approval decision for Afrezza because the agency has mistakenly forgot to complete an inspection of the European facility that makes the insulin used in Afrezza. Yet on Tuesday's call, MannKind admitted that the FDA inspection of that insulin plant was still not complete and was scheduled for next week. Management couldn't explain how or why FDA chose issue to its complete response letter for Afrezza on Friday with the manufacturing plant inspection still outstanding. MannKind management confirmed FDA is questioning the "clinical utility" of Afrezza. The company is required to submit data to FDA showing how Afrezza is to be used, by which diabetes patients in particular, and when the device's use is best. MannKind insists that no new clinical trials will be needed to compile this information for FDA, yet the company acknowledges that its original data package containing this type of information was not robust enough to assuage the FDA's concerns. Under questioning, the company also admitted that one reason FDA wants additional data on Afrezza's clinical utility is because Afrezza's use, if it's ever approved, will be restricted to certain types of diabetes patients. The FDA has told MannKind that Afrezza will require a risk-management plan to better inform patients of the risks of the device. This might include a requirement that doctors test the lung function of patients using Afrezza, according to MannKind's 10-K filed with the Securities and Exchange Commission.